Time-based services help offset 2026 Medicare cuts. Nearly 1,000 time-based codes are exempt from the 2.5% efficiency adjustment, giving practices a way to protect revenue without increasing patient volume or procedural risk.
Strong time documentation is critical. Clear start/stop times or total time, plus a summary of qualifying activities, are essential to support appropriate E/M billing, avoid audits, and defend reimbursement.
Operations must support time-based care. Successful use of exempt services requires schedule redesign, defined ownership of non-face-to-face work, and better use of EHR prompts, templates, and documentation tools.
Overview
- Many time‑based services are exempt from the 2026 Medicare payment cuts — creating opportunities to offset lost revenue.
- Physicians can protect reimbursement by expanding eligible time‑based services and improving documentation accuracy.
- Operational changes — like scheduling adjustments and better EHR use — are essential for success.
Navigating changes to Medicare services and related fee schedules can be challenging. And many physicians are concerned about payment cuts under the CY 2026 Medicare physician fee schedule final rule, which includes a 2.5% efficiency adjustment for many non-time-based services. But there’s an important exception — time-based services are excluded from the adjustment.
In fact, about 1,000 codes are now exempt, which creates an opportunity for practices to offset lost revenue by expanding or optimizing these services.
Notable exclusions in the 2026 Medicare physician fee schedule final rule include codes for:
- Advance care planning
- Annual wellness visits
- Behavioral health integration services
- Chronic care management services
- Evaluation and management (E/M) (regardless of whether the level is determined by medical decision-making (MDM) or by time)
- Maternity codes (with an MMM global period)
- Physical medicine and rehabilitation and therapy services
- Prolonged care
- Psychiatric collaborative care services
- Remote physiological monitoring services
- Services on the Medicare telehealth list
- Time-based drug administration
- Transitional care management services
Let’s take a closer look at ways physicians can leverage these services to help offset Medicare-related payment cuts.
4 strategies to help offset Medicare payment cuts
The several time‑based services that are still exempt from Medicare payment cuts, create opportunities for practices to protect — and in some cases grow — revenue by aligning care delivery and documentation with existing Medicare rules. Offsetting cuts doesn’t mean seeing more patients or taking on unnecessary risk — it means intentionally leveraging time‑based services you may already be providing. The strategies below outline practical ways physicians can use those exemptions to mitigate the financial impact of Medicare payment changes.
1. Decide whether it makes sense to offer new services or expand existing services
Given the exemptions listed in the Medicare physician fee schedule final rule, consider offering some of the time-based services listed above or expand current offerings to accommodate more patients.
Ask and answer the following questions:
- Can we deliver this service compliantly at scale?
- Do we have the right workflows and staffing to deliver this service reliably?
- Is there unmet demand for this service in our patient panel?
- What’s the true margin after labor, tech, and admin costs?
- Will this service improve access, outcomes, and retention — not just revenue?
2. Document time carefully
As payers pay closer attention to time-based billing, clear and accurate time documentation is essential to justify higher-level E/M service, avoid audits or recoupments, and protect revenue.
Consider the following:
- As of January 1, 2023, physicians can select an outpatient E/M level based on MDM or time spent with the patient as defined in each code’s service descriptors.
- The history and physical exam must meet the descriptions in the E/M code descriptors, but they don’t affect the E/M visit level selection.
- For E/M services, the medical record must include a start and stop time or the total time spent on the date of the encounter either face-to-face (with the patient and/or caregiver) or non-face-to-face. For non-E/M services, the start and stop time or total time spent on the time-based service should also be explicit.
- For time-based E/M and time-based non-E/M services, the medical record should reflect a summary of the qualifying activities that count toward the total time spent.
For E/M services, physicians can count time spent on the following tasks:
- Care coordination (not separately reported)
- Counseling and educating the patient, family, or caregiver
- Documenting clinical information in the electronic or other health record
- Independently interpreting results (not separately reported) and communicating results to the patient, family, or caregiver
- Obtaining or reviewing separately obtained history
- Ordering medications, tests, or procedures
- Performing a medically appropriate examination or evaluation
- Preparing to see the patient (e.g., review of tests)
- Referring and communicating with other health care professionals (when not separately reported)
Physicians cannot count time spent on:
- Performing other services that are reported separately
- Teaching (that is general and not limited to discussion required for the management of a specific patient)
- Travel
3. Make necessary scheduling and workflow changes
If your workday is built for 12- to 15-minute throughput visits, time-based services will always feel “extra” and impossible to perform.
To change this, implement the following practices:
- Assign clear ownership for non-face-to-face time with each patient.
- Build time-based visit types into the schedule.
- Leverage pre-visit checklists so physicians can spend time on qualifying activities
4. Leverage your EHR more effectively
Your EHR can make it easier to promote time-based services.
Take the following steps:
- Add EHR prompts that ask physicians to consider if a time-based E/M assignment is appropriate or a patient may be eligible for an additional service like advance care planning or transitional care management.
- Allow EHR-integrated ambient scribe support for counseling-heavy services.
- Use structured templates for time-based services that also include a required field for “total time spent”.
Looking ahead
To help offset Medicare payment cuts, physicians can leverage time-based services that are exempt from the 2026 Medicare efficiency adjustment. But doing so requires a shift in focus to cognitive, longitudinal, and coordination-heavy services and partnering with the right EHR vendor to ensure proper documentation and compliance.
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